From a mere add-on, customer loyalty programmes in the UAE are fast acquiring the cornerstone status in corporate strategies to boost profitability and high customer spending, triggering cross-sector collaborations and multi-brand loyalty ecosystems, industry players said.
The shift is also making sector players draw up massive investment plans, with leading companies running loyalty programmes for companies and brands in the UAE, such as Thriwe, earmarking investments of up to $30 million by 2026 to adopt AI-driven innovations to redefine customer loyalty across the Middle East.
The move comes amidst a major shift among high-income consumers towards experience-driven perks, influencing industries like travel, hospitality and luxury retail to join forces to offer AI-driven hyper-personalised rewards, sector experts said.
From golf and padel tennis to VIP concierge services and luxury transfers, cross-sector collaborations are drawing up a list of high-end ‘experiential’ services to deliver unparalleled experiences to their high-net-worth individuals (HNWIs) and modern consumers alike.
The rising industry trend, however, is expected to force smaller players to consolidate into larger coalitions to remain competitive, sector experts said.
“Studies suggest that 65 per cent of a company’s revenue comes from existing customers, and increasing retention by just 5 per cent can boost profits by up to 25 per cent,” Dhruv Verma, Founder and CEO of Thriwe, a key player in shaping the UAE loyalty industry, told Arabian Business.
“It is also estimated that top-performing [loyalty] programmes drive 15-25 per cent annual revenue growth from enrolled customers,” he said, adding that the findings are set to bring a paradigm shift in the approach by companies and brands towards their customer loyalty strategies.
Verma said research also shows that loyal customers are not only more likely to make repeat purchases but also act as brand advocates, thereby reducing customer acquisition costs.
Major players in the aviation, banking, and luxury retail sectors, such as Emirates Skywards, Etihad Guest, and Carrefour’s loyalty programme, which hold significant market shares, are among those cited as being at the forefront of the new initiatives
UAE’s loyalty programme market set for rapid expansion
Industry players said the UAE’s loyalty programme market is set for rapid expansion over the next 2-4 years, driven by cross-sector partnerships, fintech integration, and AI-driven personalisation.
Retail, travel, and financial services will collaborate to create seamless, multi-brand loyalty ecosystems, while blockchain adoption will enhance security and transparency, they said.
Verma said the latest moves come amidst increasing realisation by companies and brands that loyalty programmes are a cornerstone of modern customer retention strategies, directly influencing brand equity, consumer trust, and long-term profitability.
“In competitive markets, businesses that invest in personalised, data-driven loyalty strategies not only increase customer lifetime value, but also gain a sustainable edge in driving long-term profitability and brand advocacy,” he said.
The Thriwe chief executive also pointed out that loyal members also tend to spend more per transaction and are likelier to recommend brands, fuelling organic growth.
Industry players said companies and brands which offer premium benefits across travel, dining, sports, digital, healthcare, and lifestyle are already seeing a major boost in profitability through increased spending by their loyalty programme customers – by way of higher spending per transaction and also repeated purchases, he said.
They said the rising trend of high-income consumers shifting towards experience-driven perks is also influencing the new changes in the loyalty programme sector, especially in industries like travel and hospitality.
Verma said their company has already launched initiatives such as providing exclusive sports access, elite wellness experiences, and seamless digital engagement to enhance customer loyalty for leading brands.
Convenience, exclusivity, digital security
Sector experts, however, cautioned that companies must balance innovation with growing data privacy concerns.
With heightened competition and evolving consumer expectations, businesses that prioritise convenience, exclusivity, and secure digital experiences will lead the market, shaping the future of customer loyalty, they said.
Industry insiders said mobile apps, digital wallets, and AI-driven analytics are already making rewards more seamless and personalised, while fintech partnerships, like FAB Rewards, are enhancing accessibility.
The increasing adoption of digital payment solutions and the growing penetration of smartphones in the UAE have catalysed this shift.
Sector experts said the UAE loyalty industry currently thrives in aviation, banking, and luxury retail, with these sectors benefiting from strong brand loyalty and high-frequency transactions.
E-commerce and retail, though more fragmented, however, see intense competition, with brands like Talabat and Deliveroo leveraging cashback and points-based rewards to drive retention.
Digital rewards and coalition programmes like Beam Wallet are also gaining traction, enabling smaller players to compete effectively.
They, however, said new entrants face challenges like high customer acquisition costs and the need for advanced technology to deliver personalised rewards.
Follow us on
